June 30, 2014

PTO Reacts to Supreme Court Cases on Patentable Subject Matter in Biotechnology and Software

New developments in the question of what subject matter is eligible for patenting illustrate how this seemingly foundational question for the high-tech fields of biotechnology and software remains unsettled, even decades after these industries entered the commercial sector. Patenting for these technologies must not run afoul of the long-standing prohibition on patenting natural phenoma, laws of nature and abstract ideas. Recent years have seen the landmark cases of AMP v. Myriad (2013) and Mayo v. Prometheus (2012) issue from the Supreme Court and impact the life science sector. Myriad took on the eligibility of product claims that derived from natural substances or chemicals (e.g., genes/isolated DNA) and found them invalid. Mayo considered the eligibility of method claims where a natural correlation or relationship was embedded in the claim, therefore risking the possibility that the patent claim “preempts” the use of the natural correlation, and invalidated a method claim for optimizing drug dosage because it violated the prohibition on patenting laws of nature. Following these cases, the U.S. Patent and Trademark Office (PTO) issued new subject matter guidance for patent examiners in applying these holdings to the examination of new patent applications. This guidance document was discussed in an open forum in May of this year, and the PTO has extended the deadline for public comments to July 31, 2014.  Last week, at the annual BIO convention in San Diego, the PTO presented a set of model patent claims derived from the discovery of a protein antibiotic and written post-Myriad, and invited further comments. So the question of how life science patenting steers clear of capturing natural, uninvented subject matter continues. In the field of software patenting, a different question continues to be debated. The patenting of computer-based  technologies, which allow all manner of operations and processes to be carried out through digitization/computer code, must not cross over into the patenting of abstract ideas. Until this month, the most recent precedent on this point, Bilski v Kappos (2010), disallowed the patenting of a computer-implemented scheme for hedging against the risk of price changes because the Court declared that it was no more than an abstract idea. Just two weeks ago, the Supreme Court issued Alice Corporation Pty. Ltd. v. CLS Bank International, in which patent claims to a computer-implemented scheme for mitigating settlement risk in transactions. The Court declared the patent claims also invalid as they improperly claimed an abstract idea, which is not patentable. The PTO has issued new preliminary examination instructions that apply Alice Corp. to patent examination practice. Both lines of cases (life science and computer-related) reiterate existing precepts of patentable subject matter, but the interpretation of these cases remains unsettled. With the comment process now underway at the PTO on the post-Myriad/Mayo guidelines that extend the logic of the ruling on isolated genes to many other natural substances and products will be revisited, but it's possible that full development of the scope of this exception will again require judicial review.

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